Deepgram raises $130M at $1.3B valuation and buys a YC AI startup

Summary

Usage of voice AI in sales, marketing, customer support, and consumer applications has shot up in the last few years. As a result, model providers have seen increased business, along with investor interest. On the back of this demand, today, Deepgram said that it has raised $130 million in a Series C round led by AVP at a $1.3 billion dollar valuation. The round also saw existing investors such as Alkeon, In-Q-Tel, Madrona, Tiger, Wing, and Y Combinator put in more money. Plus, new investors like Alumni Ventures, Columbia University, Princeville Capital, Twilio, and SAP joined the round. The company has raised over $215 million in funding to date. The startup’s raise continues the trend of sizable funding rounds in voice AI last year, including Seasame’s $250 million Series B, ElevenLab’s $180 million Series C, and Gradium’s $70 million seed round. Elizabeth de Saint-Aignan, a partner at AVP, told TechCrunch that when the fund was talking to enterprises about how they were using AI, voice came up frequently, and it started looking into companies working in this area. “In 2024, when we were talking to enterprises about how they were thinking about using AI inside their business, we started to hear about them using voice AI in processes like contact centers and sales development. When we chatted with them more, we realized a lot of voice AI tech was powered by Deepgram, and that’s what led us to them [Deepgram],” Saint-Aignan said. She noted that voice AI could help in making customers’ interactions with enterprises more pleasant while reducing costs for companies, and Deepgram could play a central part in it. Deepgram has a bunch of models related to text-to-speech and speech-to-text, along with platforms and APIs for conversational speech recognition and interruption handling with low latency. It noted that more than 1,300 organizations use its voice AI products and models, including meeting notetaker Granola, voice agent startup Vapi, and Twilio. Techcrunch event S...